Battery costs could keep a brake on electric car developments

The widespread adoption of fully electric vehicles still seems to need the impetus of a technology breakthrough if it is going happen by 2020.

The widespread adoption of fully electric vehicles still seems to need the impetus of a technology breakthrough if it is going happen by 2020.

A new study by The Boston Consulting Group (BCG) concludes that the long-term cost target used by many carmakers in planning their future fleets of electric cars - $250 per kWh - is unlikely to be achieved unless there is a major breakthrough in battery chemistry that substantially increases the energy a battery can store without significantly increasing the cost of either battery materials or the manufacturing process.

Xavier Mosquet, Detroit-based leader of BCG's global automotive practice and a coauthor of the study, explained: "Given current technology options, we see substantial challenges to achieving this goal by 2020. For years, people have been saying that one of the keys to reducing our dependency on fossil fuels is the electrification of the vehicle fleet. The reality is, electric-car batteries are both too expensive and too technologically limited for this to happen in the foreseeable future."

Most electric cars in the new decade will use lithium-ion batteries, which are lighter and more powerful than the nickel-metal hydride (NiMH) batteries used today in hybrids like the Toyota Prius. Citing the current cost of similar lithium-ion batteries used in consumer electronics (about $250 to $400 per kWh), many original-equipment manufacturers (OEMs) hope that the cost of an automotive lithium-ion battery pack will fall from its current price of between $1,000 and $1,200 per kWh to between $250 and $500 per kWh at scaled production.

BCG, however, points out consumer batteries are simpler than car batteries and must meet significantly less demanding requirements, especially regarding safety and life span. As a result battery costs are likely be higher than what carmakers predict.

The cost challenge may well hold back the market but the report still projects steady growth for electric cars and batteries.

BCG estimates that 26 percent of the new cars sold in 2020 in the major developed markets (China, Japan, the United States, and Western Europe) , which equates to approximately 14 million cars, will have electric or hybrid power trains. By 2020 the market for electric-car batteries in those regions should reach $25 billion.

"This burgeoning market will be about triple the size of today's entire lithium-ion-battery market for consumer applications such as laptop computers and cell phones," said Mosquet.

To show how battery costs will decline, BCG uses the example of a typical supplier of lithium-nickel-cobalt-aluminum (NCA) batteries - one of the most prominent technologies for automotive applications. BCG's analysis suggests that by 2020, the price that OEMs pay for NCA batteries will decrease by 60 to 65 percent, from current levels of $990-$1,220 per kWh to $360-$440 per kWh. So the cost for a 15-kWh NCA range-extender pack would fall from around $16,000 to about $6,000. The price to consumers will similarly fall, from $1,400-$1,800 per kWh to $570-$700 per kWh - or $8,000-$10,000 for the same pack.

"Even in 2020, consumers will find this price of $8,000 to $10,000 to be a significant part of the vehicle's overall cost. They will carefully evaluate the cost savings of driving an electric car versus an ICE-based car against the higher up-front cost," explained Massimo Russo, a Boston-based partner and coauthor of the report. "It will be a complex purchase decision involving an evaluation of operating costs, carbon benefits, and potential range limitations, as well as product features."

Beyond costs, other key challenges facing the electric-car battery market are energy storage capacity, charging time, and infrastructure needs. BCG believes that pending a major breakthrough, batteries will continue to limit the driving range of fully electric vehicles to some 250-300 kilometers between charges. As a result, fully electric vehicles that are as convenient as ICE-based cars - meaning that they can travel 500 kilometers on a single charge and can recharge in a matter of minutes - are unlikely to be available for the mass market by 2020.

Of the roughly 14 million electric cars forecast to be sold in 2020 in China, Japan, the United States, and Western Europe, BCG projects that some 1.5 million will be fully electric, 1.5 million will be range extenders, and 11 million will be a mix of hybrids.

The BCG report is titled "Batteries for Electric Cars: Challenges, Opportunities and the Outlook to 2020".

However you are moving the polution from one place to another, there is not such thing as zero-footprint batteries. There are always side-effects to all man-made energy sources.
Look what is happening in Japan, there was an assumption that even nuclear was mature and polution free. But surprise the genie is out